oil price

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The price of bulk oil, usually quoted in US dollars per barrel. The real oil price drifted downwards in the post-war period, until in 1973–4 the Organization of Petroleum Exporting Countries (OPEC) increased it by a factor of four. This set off a severe bout of worldwide inflation, and the real price of oil since the 1970s has fluctuated substantially, illustrating the tendency of price-fixing cartels to be unstable: each member has an incentive to raise output and several OPEC members have done precisely this when in need of additional income.

Subjects: Economics.

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